Yet more bad news for savers

Category:
Savings

Updated:
31/10/2008
First Published:
01/02/2008

MONEYFACTS ARCHIVE

This article was correct at the time of publication. It is now over 6 months
old so the content may be out of date.

Today sees news that selected Barclay's savings rates will be hit for the third time in as many months. Barclay's Savings Builder and Day to Day Savings Accounts face a 0.24% reduction on 1 February. Barclay's Day to Day savings account will pay 3.69%; Barclay's Savings Builder savings account will pay;

4.17% at £10000,

4.31% at £25000,

4.41% at £50000,

4.55% at £100000,

4.65% at £250000.

This is disappointing news, particularly so soon after the previous cuts to savings accounts rates. A total cut of 0.74% will make a significant dent to your savings account interest return, especially when the savings account rates are far from market leading.

While other savings account providers opted for the same two prong rate reduction, just prior to and following December's rate cut and others changed rates in December by more than the base rate, the maximum cut we have seen so far was 0.55%. Barclays truly stands out from the crowd with a cut to savings account rates almost three times that of Bank of England base rate.

Although the Barclay's Day to Day Savings account is paying one of the highest rates available on the high street from £1, if you are prepared to bank online, via the telephone or post, savings account rates over 6% are easily achievable.

With another base rate cut imminent, savers must ensure they get a good deal on their savings account rates. The savings account market is still healthy with great rates to be found. Following December's base rate cut, best buy savings accounts from Icesave, ICICI and Anglo Irish were unscathed.

So some savers are getting a great deal on their savings accounts and have the bonus of not having seen any rate reduction, while others suffer as already average rates are slashed despite the base rate remaining on hold.

It's never been more important to check your savings rates it's easy to switch providers. If you don't you could potentially be missing out of hundreds of pounds in interest each year.

With Moneyfacts.co.uk you can compare around 2,000 different savings accounts to make sure you're getting the best deal.